EXHIBIT 1.01
EXECUTION ORIGINAL
$150,000,000
SALEM COMMUNICATIONS CORPORATION
9.5% SENIOR SUBORDINATED NOTES DUE 2007
PLACEMENT AGREEMENT
September 17, 1997
Xxxxxx Xxxx LLC
Xxxxx Xxxxxx Inc.
BancBoston Securities Inc.
BNY Capital Markets, Inc.
x/x Xxxxxx Xxxx LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Salem Communications Corporation, a corporation organized under the
laws of the State of California (the "COMPANY"), proposes to issue and sell to
the initial purchasers listed on Schedule I hereto (the "INITIAL PURCHASERS"),
an aggregate of $150,000,000 principal amount of its 9.5% Senior Subordinated
Notes Due 2007 (the "NOTES"). The Notes will be fully and unconditionally
guaranteed on a senior subordinated basis as to payment of principal, premium,
if any, and interest (the "GUARANTEES" and together with the Notes, the
"SECURITIES"), jointly and severally, by all of the Company's subsidiaries (the
"GUARANTORS"), which are listed on Schedule II hereto. The Securities are to be
issued pursuant to an Indenture (the "INDENTURE"), to be dated as of September
25, 1997 among the Company, the Guarantors and The Bank of New York, a New York
banking corporation, as trustee (the "TRUSTEE"). The Securities will be offered
and sold to the Initial Purchasers (the "OFFERING") without being registered
under the Securities Act of 1933, as amended (the "SECURITIES ACT"), in reliance
upon certain exemptions set forth therein.
In connection with the offer and sale of the Securities, the Company
has prepared a preliminary Offering Memorandum dated September 2, 1997 (the
"PRELIMINARY MEMORANDUM") and a final Offering Memorandum dated September 17,
1997 (the "FINAL MEMORANDUM" and, together with the Preliminary Memorandum, each
a "MEMORANDUM", which terms shall include, unless otherwise indicated herein,
any amendments or supplements thereto) containing, among other things, a
description of the terms of the Securities and information relating to the
Company and its business. Unless otherwise defined in this Agreement,
capitalized terms used herein have the meanings specified or referred to in the
Final Memorandum.
On the Closing Date, the Company will utilize a portion of the net
proceeds of the Offering to repay all outstanding indebtedness under its
$150,000,000 Existing Credit Agreement and
will thereupon terminate such agreement and enter into the New Credit Agreement
(the "CREDIT AGREEMENT REPLACEMENT").
The Initial Purchasers and their direct and indirect transferees each
will be entitled to the benefits of a Registration Rights Agreement among the
Company, the Guarantors and the Initial Purchasers (the "REGISTRATION RIGHTS
AGREEMENTS"), to be entered into as of the Closing Date, pursuant to which the
Company and the Guarantors will agree to use their best efforts to file with the
Securities and Exchange Commission (the "COMMISSION") and have declared
effective under the Securities Act the Exchange Offer Registration Statement
registering the offer and sale of the Exchange Notes and guarantees referred to
in the Registration Rights Agreement, or, in certain circumstances, a Shelf
Registration Statement, registering the resale of the Securities, as the case
may be.
1. Representations and Warranties. The Company and the Guarantors,
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jointly and severally, represent and warrant to, and agree with, the Initial
Purchasers that as of the date hereof and on the Closing Date (or, with respect
to representations and warranties with respect to a Memorandum, as of the date
or dates stated):
(a) The Preliminary Memorandum, as of its date contained and as of
the date hereof contains, and the Final Memorandum as of the Closing Date
will contain, all the information specified in, and meets and will meet the
requirements of, Rule 144A(d)(4) of the Act and the Preliminary Memorandum,
as of its date and as of the date hereof is, and the Final Memorandum, as
of the Closing Date will be, accurate in all material respects and does not
and will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that the Company
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makes no representations or warranties as to the information contained in
or omitted from each Memorandum in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of the
Initial Purchasers specifically for inclusion in each Memorandum.
(b) The Company and the Guarantors had, have and will have, as the
case may be, good and marketable title to all real property and good and
marketable title to all personal property described in the Preliminary
Memorandum as of its date and as of the date hereof and the Final
Memorandum as of the Closing Date, as owned by them, in each case free and
clear of all liens, encumbrances and defects except (i) liens permitted
pursuant to Section 1012 of the Indenture or (ii) such as do not,
individually or in the aggregate, materially interfere with the use made
and proposed to be made of such property by the Company and the Guarantors;
any real property and buildings held under lease by the Company or any of
the Guarantors were, are or will be held, as the case may be, as described
in the Preliminary Memorandum as of its date and as of the date hereof and
in the Final Memorandum as of the Closing Date, by them under valid,
subsisting and enforceable leases with such exceptions as are not material,
individually or in the aggregate, and do not interfere materially with the
use made and proposed to be made of such property by the Company and the
Guarantors; all rent and other sums and charges payable by the Company and
the Guarantors as tenants thereunder are current, no termination event or
condition or uncured default on the part of the Company or any such
Guarantor or, to the Company's knowledge, the landlord, exists under any
such lease, except any such failure to pay rent, other sums or charges,
termination event or condition or uncured default that would not,
individually or in the aggregate, have a material adverse effect
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on the condition (financial or otherwise), results of operation, business,
prospects, net worth or assets of the Company and the Guarantors, taken as
a whole, or on the ability of the Company and the Guarantors to perform
their respective obligations under this Agreement, the Notes, the
Guarantees, the Indenture and the Registration Rights Agreement (a
"MATERIAL ADVERSE EFFECT"); each of the Company and the Guarantors has
complied with all obligations, considering applicable grace periods, under
all leases to which such person is a party and under which such person is
in occupancy, except failures to comply as would not, individually or in
the aggregate, have a Material Adverse Effect; with respect to all such
leases, to the knowledge of the Company, no person has instituted or
threatened to institute proceedings, or has taken or threatened to take any
other action, to challenge or terminate, and no event or circumstance has
occurred which reasonably could be expected to materially interfere with
(x) the lessee's right to occupy the premises leased thereunder or to
continue to use such premises in the manner in which it is currently being
used, or (y) the lessor's right to continue to lease such premises to the
lessee; none of such leases contains any provision restricting the
incurrence of indebtedness by the lessee, or any unusual or burdensome
provision which could reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect; and to the Company's
knowledge each of such leases, were it to be terminated, could be replaced
at a total annual cost to the Company and the Guarantors that,
individually, would not cause a Material Adverse Effect.
(c) The Company has no direct or indirect subsidiaries other than the
Guarantors listed on Schedule II hereto, all the capital stock or general
partnership interests, as the case may be, of each of which is owned by the
Company or a Wholly Owned Restricted Subsidiary.
(d) Each of the Company and the Guarantors has been duly organized and
was or is, or will be, as the case may be, validly existing as a
corporation or general partnership, as the case may be, in good standing
under the laws of the jurisdiction of its organization, with requisite
power and authority (corporate and other) to own or lease its properties
and conduct its business as described in the Preliminary Memorandum as of
its date and as of the date hereof and in the Final Memorandum as of the
Closing Date, and is duly qualified to do business as a foreign corporation
or general partnership, as the case may be, and is in good standing under
the laws of each jurisdiction in which the character of the business
conducted by it or the location of the properties owned or leased by it
make such qualification necessary, except to the extent that any such
failure to be so qualified or be in good standing would not, individually
or in the aggregate, have a Material Adverse Effect.
(e) The Company had, has or will have, as the case may be, an
authorized capitalization as set forth in the column headed "Actual" under
the caption "Capitalization" in the Preliminary Memorandum as of its date
and as of the date hereof and in the Final Memorandum as of the Closing
Date, and all of the issued and outstanding shares of Capital Stock of the
Company have been duly and validly authorized and issued and are fully paid
and non-assessable; and all of the issued and outstanding shares of capital
stock of each Guarantor have been duly and validly authorized and issued,
are fully paid and non-assessable, and are owned directly by the Company or
a Wholly Owned Restricted Subsidiary, free and clear of all liens,
encumbrances, equities or claims, other than the liens created by the
pledge of shares of stock of the Guarantors, as of the date hereof,
pursuant to the Existing Credit Agreement, and as of the Closing Date,
pursuant to the New Credit Agreement.
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(f) Each of the Company and the Guarantors has requisite corporate or
partnership power and authority, as the case may be, to execute and
deliver, and to perform its respective obligations under, this Agreement,
the Indenture, the Notes, the Guarantees and the Registration Rights
Agreement, to consummate the transactions contemplated hereby and thereby,
and to issue, sell and deliver the Securities to be sold by it to the
Initial Purchasers as provided herein and therein.
(g) The Notes have been duly and validly authorized by all necessary
corporate action (including, without limitation, required stockholder
approvals, if any) and, when executed and authenticated in accordance with
the provisions of the Indenture, and delivered to and paid for by the
Initial Purchasers in accordance with the terms of this Agreement, will be
legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms, except as such enforceability
(x) may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting creditors' rights generally (y) is subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (z) with respect to
rights to indemnity or contribution, may be limited by applicable law or by
the policies underlying such laws, and will be entitled to the benefits of
the Indenture; and the Securities, the Indenture and the Registration
Rights Agreement will conform, as of the Closing Date, to the descriptions
thereof contained in each Memorandum.
(h) The Guarantees have been duly and validly authorized by all
necessary corporate or partnership action (including, without limitation,
required stockholder, shareholder or general partner approvals, if any)
and, when executed and authenticated in accordance with the terms of the
Indenture and delivered to the Initial Purchasers in accordance with the
terms of this Agreement, will be legal, valid and binding obligations of
the Guarantors enforceable against the Guarantors in accordance with their
terms, except as such enforceability (x) may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting creditors'
rights generally, (y) is subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (z) with respect to rights to indemnity or
contribution, may be limited by applicable law or by the policies
underlying such laws, and will be entitled to the benefits of the
Indenture.
(i) This Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by all necessary
corporate or partnership action (including, without limitation, required
stockholder, shareholder or general partner approvals, if any) of the
Company and each Guarantor, and this Agreement has been executed and
delivered by the Company and each Guarantor and constitutes the legal,
valid and binding agreement of the Company and each Guarantor, enforceable
against the Company and each Guarantor in accordance with its terms, except
as such enforceability (x) may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally,
(y) is subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and (z)
with respect to rights to indemnity or contribution, may be limited by
applicable law or by the policies underlying such laws.
(j) The Indenture and the consummation of the transactions
contemplated thereby, including the issuance of the Securities, have been
duly and validly authorized by all necessary corporate or partnership
action (including, without limitation, required stockholder, shareholder or
general partner approvals, if any) of Company and each Guarantor, and when
the Indenture
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is executed and delivered by the Company and each Guarantor, the Indenture
will be a legal, valid and binding agreement of the Company and each
Guarantor, enforceable against the Company and each Guarantor in accordance
with its terms, except as such enforceability (x) may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting
creditors' rights generally, (y) is subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (z) with respect to rights to indemnity or
contribution, may be limited by applicable law or by the policies
underlying such laws, and will be in sufficient form for qualification
under the Trust Indenture Act of 1939, as amended (the "TRUST INDENTURE
ACT") and the rules and regulations of the Commission promulgated
thereunder.
(k) The Registration Rights Agreement and the consummation of the
transactions contemplated thereby have been duly and validly authorized by
all necessary corporate or partnership action (including, without
limitation, required stockholder, shareholder or general partner approvals,
if any) of the Company and each Guarantor, and when the Registration Rights
Agreement is executed and delivered by the Company and each Guarantor, the
Registration Rights Agreement will be a legal, valid and binding agreement
of the Company and each Guarantor, enforceable against the Company and each
Guarantor in accordance with its terms, except as such enforceability (x)
may be limited by bankruptcy, insolvency, reorganization or other similar
laws affecting creditors' rights generally, (y) is subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (z) with respect to
rights to indemnity or contribution, may be limited by applicable law or by
the policies underlying such laws.
(l) Neither the Company nor any Guarantor is, or with the giving of
notice or lapse of time or both would be, in violation of or in default
under, nor will the execution or delivery of this Agreement, the Indenture
or the Registration Rights Agreement nor the consummation of the
transactions contemplated hereby or thereby, result in a violation of, or
constitute a default under, the Certificates or Articles of Incorporation,
by-laws or other governing documents of the Company or any of the
Guarantors, or any loan agreement, indenture, mortgage, deed of trust,
lease, network affiliation agreement, programming contract or any other
agreement or instrument to which the Company or any of the Guarantors is a
party or by which any of them is bound, or to which any of their respective
properties is subject, except for such violations of or such defaults under
any such loan agreement, indenture, mortgage, deed of trust, lease, network
affiliation agreement, programming contract or other agreement or
instrument, as would not, individually or in the aggregate, have a Material
Adverse Effect; nor will the performance by the Company and the Guarantors
of their respective obligations hereunder or thereunder cause a material
violation of any law, rule, administrative regulation, license or decree of
any court, governmental agency or body having jurisdiction over the Company
or any of the Guarantors or any of their respective properties, or result
in the creation or imposition of any lien, charge, claim or encumbrance
upon any property or asset of the Company or any of the Guarantors, except,
in each case, as would not, individually or in the aggregate, have a
Material Adverse Effect. No consent, approval, authorization or order of,
or filing or registration or qualification with, any court or governmental
agency or body or financial institution, or any other party under any loan
agreement, indenture, mortgage, deed of trust, lease, network affiliation
agreement, programming contract or any other agreement or instrument to
which the Company or any of the Guarantors is a party or by which any of
them is bound or to which any of their respective properties is subject,
will be required as of the Closing Date on the part of the Company or
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any Guarantor for the authorization, issuance, sale and delivery of the
Securities, or the execution, delivery and performance by the Company and
the Guarantors of their respective obligations under this Agreement, the
Indenture and the Registration Rights Agreement or the consummation of the
transactions contemplated hereby or thereby, except (1) as have been
obtained, (2) as may be required under the "Blue Sky" laws of the various
states in connection with the offer and sale of the Securities and (3) as
may be required by the Securities Act, the "Blue Sky" laws of the various
states, the Trust Indenture Act and the bylaws and rules of the National
Association of Securities Dealers, Inc. ("NASD"), in conjunction with an
exchange offer for, or registered resale of, the Securities pursuant to the
Registration Rights Agreement and the qualification of the Indenture and
the Trustee.
(m) The Company and each Guarantor held, holds or will hold, as the
case may be, all material licenses, certificates, permits, consents,
orders, authorizations and approvals (collectively, "LICENSES") from
governmental authorities which are necessary to the conduct of their
businesses in the manner and to the extent operated as described in the
Preliminary Memorandum as of its date and as of the date hereof and in the
Final Memorandum as of the Closing Date; such Licenses are in full force
and effect and no proceeding has been instituted or, to the Company's
knowledge, is threatened, pending or contemplated which in any manner
affects or draws into question the validity or effectiveness thereof; such
Licenses contain no materially burdensome restrictions not customarily
imposed by the Federal Communications Commission (the "FCC") on radio
stations of the same class and type as the Company's radio stations (the
"STATIONS"); the operation of the Stations in the manner and to the extent
operated as described in the Preliminary Memorandum as of its date and as
of the date hereof and in the Final Memorandum as of the Closing Date, was,
is or will be, as the case may be, in accordance with the Communications
Act of 1934, as amended and the Telecommunications Act of 1996, as amended,
and all orders, rules and regulations of the FCC, in each case, in all
material respects; to the knowledge of the Company, no event has occurred
that permits (nor has an event occurred that with notice or lapse of time
or both would permit) the revocation or termination of such Licenses or
that might result in any other material impairment of the rights of the
Company or the Guarantors therein other than revocations or terminations
that would not, individually or in the aggregate, have a Material Adverse
Effect; and the Company and the Guarantors are in substantial compliance
with all statutes, orders, rules or regulations of the FCC relating to or
affecting the broadcasting operations of either of the Stations.
(n) The Company and each Guarantor own, possess or currently have the
rights to use patent rights, inventions, trademarks, service marks, trade
names and copyrights (including, without limitation, the service marks
"Salem Communications Corporation" and "Salem Radio Network") necessary to
conduct the general business now operated by them, and neither the Company
nor any of the Guarantors has received any written notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to, any patent, patent rights, inventions, trademarks, service
marks, trade names or copyrights which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
(o) To the knowledge of the Company and the Guarantors, each of them
is in compliance in all material respects with all Environmental Laws (as
defined below), except to the extent that failure to comply with such
Environmental Laws would not have, individually or in the aggregate, a
Material Adverse Effect. None of the Company or any of the Guarantors is
the subject of any pending or, to the knowledge of the Company, threatened
Federal, state or local investigation evaluating whether any remedial
action by the Company or
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the Guarantors is needed to respond to a release of any Hazardous Materials
(as defined below) into the environment, resulting from the business
operations of the Company or any of the Guarantors or ownership or
possession of any of their properties or assets or is in contravention of
any Environmental Law that the Company reasonably believes could reasonably
be expected to result, individually or in the aggregate, in a fine or
penalty in excess of $100,000 or in a Material Adverse Effect. None of the
Company or the Guarantors has received any written notice or claim, nor are
there pending or, to the knowledge of the Company, threatened lawsuits or
governmental proceedings against them, with respect to violations of or
liabilities under any Environmental Law or in connection with any release
of any Hazardous Material into the environment that could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect. As used herein, "ENVIRONMENTAL LAWS" means any Federal, state or
local law, regulation, license, permit, certificate, consent, order,
approval or other authorization applicable to the business operations of
the Company or any of the Guarantors or ownership or possession of any of
their properties or assets relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes,
pollutants and contaminants, and "HAZARDOUS MATERIALS" means those
substances, wastes, pollutants or contaminants that are regulated by or
from the basis of liability under any Environmental Laws.
(p) Each of the Company and the Guarantors has timely filed all
Federal, state and local income and other material tax returns and notices
required to be filed by applicable law; no audit, administrative
proceedings or court proceedings are presently pending with regard to any
material potential Federal, state or local tax of any nature; the Company
has no knowledge of any tax deficiencies which could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect; each
of the Company and the Guarantors has paid (within the time and in the
manner prescribed by law) all Federal, state and local taxes of any nature
which are shown on its returns to be due, in each case except for those not
yet delinquent and those being contested in good faith by appropriate
proceedings diligently conducted for which each of the Company and the
Guarantors has established on its books and records adequate reserves to
pay all outstanding tax liabilities in accordance with GAAP; neither the
Company nor any of the Guarantors has requested any extension of time
within which to file any material tax return, which return has not since
been filed; the amounts currently set up as provisions for taxes or
otherwise by the Company and the Guarantors on their books and records are
sufficient for the payment of all their unpaid Federal, state and local
taxes accrued through the dates as of which they speak, and for which the
Company and the Guarantors may be liable in their own right, or as a
transferee of the assets of, or as successor to any other corporation,
association, partnership, joint venture or other entity;
(q) Each of the Company and the Guarantors maintains (and in the
future will maintain) a system of internal accounting controls sufficient
to provide reasonable assurances that (i) transactions are executed in
accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(r) Each of the Company and the Guarantors, immediately after the
Closing Date and after giving effect to the issuance and sale of the
Securities and the application of the
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proceeds thereof will, in the opinion of the Company, be Solvent. As used
herein, the term "SOLVENT" means, with respect to any such entity on a
particular date (i) the fair valuation of the property of such entity is
greater than the total amount of known liabilities (including known
contingent liabilities) of such entity, (ii) such entity will be able to
pay its debts and liabilities as they mature and (iii) such entity will not
have unreasonably small capital for the business in which it is engaged, as
now conducted and as proposed to be conducted following the consummation of
the Offering and the application of the proceeds thereof.
(s) Except as described in the Preliminary Memorandum as of its date
and as of the date hereof and in the Final Memorandum as of the Closing
Date, there was, is or will be, as the case may be, no action, suit or
proceeding before any court or governmental agency, authority or body or
any arbitrator involving the Company or any Guarantor or any property of
the Company or any Guarantor which is pending or, to the knowledge of the
Company, contemplated against the Company or any Guarantor that,
individually or in the aggregate, could have a Material Adverse Effect.
(t) Neither the Company nor any Guarantor is in violation of any law,
ordinance, governmental rule or regulation or court decree to which it may
be subject, which violation could have, individually or in the aggregate, a
Material Adverse Effect.
(u) The Company and the Guarantors are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which they
are engaged; since 1986, the Company has not failed to obtain insurance
coverage of any nature by reason of the refusal of insurers to provide such
coverage; and the Company does not have any reason to believe that it will
not be able to renew its existing insurance coverage from similar insurers
as may be necessary to continue its business at a cost that would not have,
individually or in the aggregate, a Material Adverse Effect.
(v) Except as disclosed in the Preliminary Memorandum as of its date
and as of the date hereof and in the Final Memorandum as of the Closing
Date, neither the Company nor any of the Guarantors had, has or will have,
as the case may be, violated any Federal, state or local law relating to
discrimination in employment nor any applicable wage or hour laws, nor any
provisions of the Employee Retirement Income Security Act of 1974, as
amended, or the rules and regulations promulgated thereunder ("ERISA"), nor
has the Company or any of the Guarantors engaged in any unfair labor
practice, which in each case could reasonably be expected to result,
individually or in the aggregate, in a Material Adverse Effect. Except as
disclosed in the Preliminary Memorandum as of its date and as of the date
hereof and in the Final Memorandum as of the Closing Date, there was, is or
will be, as the case may be (i) no unfair labor practice complaint pending
against the Company or any of the Guarantors or, to the knowledge of the
Company, threatened against any of them, before the National Labor
Relations Board or any state or local labor relations board and neither the
Company nor any of the Guarantors is party to any collective bargaining
agreement, (ii) no significant strike, labor dispute, slowdown or stoppage
pending against the Company or any of the Guarantors, or, to the knowledge
of the Company, threatened against any of them and (iii) to the knowledge
of the Company, no union representation question existing, with respect to
employees of the Company or any of the Guarantors, except (with respect to
any matter specified in clause (i), (ii) or (iii) above, individually or in
the aggregate) such as would not have a Material Adverse Effect, and the
Company and the Guarantors have no reason to
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believe that the relationship of the Company and the Guarantors with their
employees is likely to have, individually or in the aggregate, a Material
Adverse Effect.
(w) Subsequent to the respective dates as of which information is
given in each Memorandum (i) the Company and the Guarantors have not
incurred any material liability or obligation, direct or contingent, nor
entered into any material transaction not in the ordinary course of
business except as described in or contemplated by each Memorandum; and
(ii) there has not been any material adverse change in the condition
(financial or otherwise), results of operations, business, prospects, net
worth or assets of the Company and the Guarantors, taken as a whole, from
the date as of which information is given in each Memorandum.
(x) The statements set forth, in the Preliminary Memorandum as of its
date and as of the date hereof and in the Final Memorandum as of the
Closing Date, under the captions "Description of Certain Indebtedness"
insofar as they purport to constitute a description of the terms of the
indebtedness of the Company other than the Securities and under "Business--
Corporate Structure and Reorganization" insofar as they purport to
constitute a description of the terms of the documents pursuant to which
the Reorganization was consummated were, are or will be, as the case may
be, accurate, complete and fair in all material respects.
(y) Neither the Company nor any of the Guarantors nor any of their
respective officers, directors or employees has employed any broker or
finder or incurred any liability for any brokerage fees, commissions or
finders' fees in connection with the issuance of the Securities, other than
to the Initial Purchasers pursuant to this Agreement.
(z) Neither the Company nor any of the Guarantors nor any agent
thereof acting on behalf of any of them has taken, and none of them will
take, any action that might cause this Agreement or the issuance or sale of
the Securities and the use of the proceeds therefrom to violate Section 7
of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") or
any regulation promulgated thereunder, including, without limitation,
Regulation G (12 C.F.R. Part 207), Regulation T (12 C.F.R. Part 220),
Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of
the Board of Governors of the Federal Reserve System, in each case as in
effect on the date hereof or as the same may hereafter be in effect on the
Closing Date.
(aa) Assuming that the representations, warranties and covenants of
the Initial Purchasers contained in this Agreement are true and correct and
have been and will be complied with, no registration of the Securities
under the Securities Act or qualification of an indenture under the Trust
Indenture Act is required for the offer, sale and delivery of the
Securities to the Initial Purchasers or the initial resale thereof in the
manner contemplated by this Agreement.
(ab) In connection with the offer and sale of the Securities, the
Company and the Guarantors have not taken and will not take, directly or
indirectly, any action prohibited by Regulation M under the Exchange Act.
(ac) The Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act.
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(ad) Ernst & Young LLP, whose report appears in each Memorandum, are
independent accountants with respect to the Company.
(ae) The consolidated financial statements of the Company and notes
thereto (including the related schedules, if any) included in the
Preliminary Memorandum as of its date and as of the date hereof presented
or present, as the case may be, and in the Final Memorandum as of the
Closing Date will present, fairly, in all material respects, the
consolidated financial position of the Company and the Guarantors and the
consolidated results of their operations and cash flows purported to be
shown thereby, at the dates and for the periods indicated, and have been
prepared in accordance with GAAP throughout the periods indicated (except
as otherwise indicated therein and subject, in the case of interim
statements, to normal year-end adjustments); the summary and selected
consolidated financial information included in the Preliminary Memorandum
as of its date and as of the date hereof presented or present, as the case
may be, and in the Final Memorandum as of the Closing Date will present,
fairly in all material respects the information shown therein in accordance
with the adjustments and assumptions described therein, have been prepared,
in all material respects, in accordance with the rules and guidelines of
the Commission with respect to the financial data presented and, in the
Company's opinion, give effect to assumptions which have been made on a
reasonable basis and the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred to therein; and the
other financial, accounting and statistical information and data related to
the Company and the Guarantors set forth in the Preliminary Memorandum as
of its date and as of the date hereof presented or present, as the case may
be, and in the Final Memorandum as of the Closing Date will present fairly,
in all material respects, the information purported to be shown thereby at
the respective dates and for the respective periods to which they apply,
and except as disclosed therein, have been prepared on a basis consistent
with the financial statements and the books and records of the entities as
to which such information is shown.
(af) Neither the Company nor any of its affiliates (as defined in Rule
501 under the Securities Act, "AFFILIATE") has directly, or through any
agent, (i) sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as defined in the Securities Act)
which is or will be integrated with the sale of the Securities in a manner
that would require the registration under the Securities Act of the
Securities as contemplated to be offered or (ii) engaged in any form of
general solicitation or general advertising in connection with the offering
of the Securities (as such terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
(ag) Neither the Company nor any of the Guarantors is, and after
giving effect to the offering and sale of the Securities and the
application of the proceeds therefrom as described in each Memorandum under
the caption "Use of Proceeds" will be, an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT").
(ah) The Reorganization has been duly and validly consummated, and
such consummation did not and will not result in a violation of, or
constitute a default under, the Certificate or Articles of Incorporation,
by-laws or other governing documents of the Company or any of the
Guarantors, or any loan agreement, indenture, mortgage, deed of trust,
lease, network affiliation agreement, programming contract or any other
agreement or instrument to
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which the Company or any of the Guarantors is a party or by which any of
them is bound or to which any of their respective properties is subject,
except for such violations of or such defaults under any such loan
agreement, indenture, mortgage, deed of trust, lease, network affiliation
agreement, programming contract or other agreement or instrument, as would
not have, individually or in the aggregate, a Material Adverse Effect; the
performance by the Company and the Guarantors of their respective
obligations with respect to such Reorganization did not and will not cause
a material violation of any law, rule, administrative regulation, license
or decree of any court, governmental agency or body having jurisdiction
over the Company or any of the Guarantors or any of their respective
properties, or result in the creation or imposition of any lien, charge,
claim or encumbrance upon any property or asset of the Company or any of
the Guarantors. Except for such consents, approvals and authorizations
which have been obtained, no consent, approval, authorization or order of,
or filing or registration or qualification with, any court, governmental
agency or body or financial institution, or any other party under any loan
agreement, indenture, mortgage, deed of trust, lease, network affiliation
agreement, programming contract or any other agreement or instrument to
which the Company or any of the Guarantors is a party or by which any of
them is bound or to which any of their respective properties is subject, is
required in connection with the consummation of the Reorganization, other
than consents or approvals the failure of which to obtain would not,
individually or in the aggregate, have a Material Adverse Effect.
(ai) The list of the Company's owned and/or operated Stations set
forth under the caption "Business--General" and the list of studios and
tower and antenna sites set forth under the caption "Business--Properties
and Facilities" each is accurate and complete in all material respects with
respect to the information it purports to present.
(aj) The Company has no knowledge that any block programming customer
of the Company and the Guarantors intends to cease to be a customer of the
Company and the Guarantors which cessation could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
(ak) The failures, exclusions and other exceptions to the
representations and warranties of the Company and the Guarantors, taken as
a whole, would not have a Material Adverse Effect.
(al) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes 1996, as amended,
and all regulations promulgated thereunder.
Representations and warranties of the Company and the Guarantors made to their
"KNOWLEDGE" shall be understood for purposes of this Agreement to be made to the
knowledge after due inquiry of the executive officers and directors of the
Company or the Guarantor, as the case may be, unless otherwise stated in this
Agreement.
2. Offering; Restrictions on Transfer. The Initial Purchasers have
----------------------------------
advised the Company that the Initial Purchasers will make an offering of the
Securities purchased by the Initial Purchasers hereunder on the terms and
conditions set forth in the Memorandum, as soon as practicable after this
Agreement is entered into as in the Initial Purchasers' sole judgment is
advisable. Each
-11-
Initial Purchaser hereby, severally and not jointly, represents and warrants to,
and agrees with, the Company that:
(a) the Securities have not been registered under the Securities Act
and may not be offered or sold except pursuant to an effective registration
statement or an exemption from the registration requirements of the
Securities Act; such Initial Purchaser (i) has not and will not solicit
offers for, or offer to sell, the Securities by any form of general
solicitation or general advertising (as those terms are used in Regulation
D under the Securities Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act and (ii) has and
will solicit offers for the Securities only from, and will offer the
Securities only to, (A) persons who it reasonably believes to be "qualified
institutional buyers" within the meaning of Rule 144A under the Securities
Act in transactions meeting the requirements of Rule 144A or (B) a limited
number of other institutional investors reasonably believed by such Initial
Purchasers to be "accredited investors" as defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D under the Securities Act and, in the case of
such purchaser described in this clause (ii)(B), provide the Company a
letter in the form of Exhibit A to each Memorandum; and
(b) It is either a "qualified institutional buyer" within the meaning
of Rule 144A under the Securities Act or an "accredited investor" within
the meaning of Rule 501 under the Securities Act, and, if an accredited
investor, will provide the Company prior to the Closing Date with a letter
in the form of Exhibit A attached to each Memorandum.
The Initial Purchasers understand that the Company, and, with respect to their
opinions delivered pursuant to this Agreement, counsel to the Company and
counsel to the Initial Purchasers, will rely upon the accuracy and truth of the
foregoing representations, warranties and agreements and the Initial Purchasers
hereby consent to such reliance.
3. Purchase and Delivery; Commission. (a) The Company agrees to
---------------------------------
sell to the Initial Purchasers and the Initial Purchasers, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agree to purchase from the Company the aggregate principal
amount of Notes at a purchase price of 97.25% of such aggregate principal amount
and (b) the Guarantors hereby agree to issue the Guarantees.
Payment for the Notes shall be made to the Company or its order by
wire transfer of, immediately available funds to an account specified by the
Company by written notice to the Initial Purchasers not less than two business
days prior to the Closing Date, at 10:00 a.m. New York City time on September
25, 1997 or at such other time and date as the Company may agree upon in
writing, such time and date being herein called the "CLOSING DATE," against
delivery of the Securities at the offices of Xxxxxx Xxxx LLC, 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, or such other location as the Initial Purchasers
shall designate, at 10:00 a.m., New York City time on the Closing Date.
The Securities, if in certificated form, shall be made available for
inspection, checking and packaging by the Initial Purchasers at the above-
mentioned New York offices of Xxxxxx Xxxx LLC, at least 24 hours prior to the
time of delivery.
-12-
It is understood that each certificate evidencing Securities shall
bear a legend to the following effect, unless the Company and the Trustee
determine otherwise consistent with applicable law:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER SECTION 5 OF THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD TO, OR FOR THE ACCOUNT OR BENEFIT
OF ANY PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3)
OR (7) UNDER THE SECURITIES ACT) (AN "ACCREDITED INVESTOR"), (2) AGREES
THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS
SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE
COMPANY, OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS
BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM
THE TRUSTEE OR REGISTRAR), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
TRANSFER OF THIS SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF
THE SECURITY, IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED
INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE
AND THE COMPANY SUCH CERTIFICATIONS, WRITTEN LEGAL OPINIONS OR OTHER
INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER.
-13-
The Company shall pay any transfer taxes payable in connection with
the initial delivery to the Initial Purchasers of the Securities.
4. Initial Purchasers's Conditions to Closing. The obligation of
------------------------------------------
the Initial Purchasers to purchase and pay for the Securities will be subject
to the accuracy of the representations and warranties on the part of the Company
and the Guarantors herein, to the accuracy of the statements of the authorized
representatives of the Company and the Guarantors made in any certificates
pursuant to the provisions hereof, to the performance by the Company and the
Guarantors of their respective obligations hereunder and to the following
additional conditions precedent:
(a) Subsequent to the date hereof or, if earlier, the dates as of
which information is given in the Final Memorandum, there shall not have
been any change which, in the judgment of the Initial Purchasers, has or
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect such that it is impractical or inadvisable to offer
and deliver the Securities as contemplated by each Memorandum. No stop
order or other similar decree preventing the use of either Memorandum, or
any order asserting that the transactions contemplated hereunder are
subject to the registration requirements of the Securities Act or "Blue
Sky" laws of any jurisdiction has been issued and no proceeding for that
purpose has commenced or is pending or, to the best knowledge of the
Company after due inquiry, is contemplated.
(b) The Company shall have furnished to the Initial Purchasers a
certificate of the Company and the Guarantors, signed by the President and
the Vice President - Finance of the Company and by the President and Vice
President of the Guarantors, dated the Closing Date, to the effect that the
signers of such certificate have carefully examined the Final Memorandum,
the Indenture, the Registration Rights Agreement and this Agreement and
that:
(i) the representations and warranties of the Company and the
Guarantors that are qualified as to materiality in this Agreement are
true and correct, and those not so qualified are true and correct in
all material respects, on and as of the Closing Date with the same
effect as if made on the Closing Date and the Company and the
Guarantors have complied with all the agreements and satisfied all the
conditions in this Agreement on their respective parts to be performed
or satisfied at or prior to the Closing Date;
(ii) since the date of the most recent financial statements
included in the Final Memorandum, there has been no material adverse
change in the condition (financial or other), results of operations,
business, prospects, net worth or assets of the Company and the
Guarantors, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Final Memorandum; and
(iii) the FCC broadcast station licenses listed under the
caption "Business--Federal Regulation of Radio Broadcasting" in the
Final Memorandum as of the Closing Date, are all of such licenses
granted with respect to Stations owned or operated by the Company, the
Guarantors and, in the case of each Station operated but not owned by
the Company or a Guarantor, the licensee of such Station; the Company,
the Guarantors and such licensees hold licenses for each of their
respective Stations sufficient to operate each such Station and each
such license is validly issued in the
-14-
name of the Company, a Guarantor, or such licensee, is in full force
and effect and any assignments thereof have been approved by orders of
the FCC.
(c) The Company shall have furnished to the Initial Purchasers the
opinion of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel for the Company and the
Guarantors, or, to the extent acceptable to the Initial Purchasers, of Xxxx
X. Xxxxxxxxx, general counsel to the Company and the Guarantors, each dated
the Closing Date, to the effect that:
(i) each of the Company and the Guarantors is validly existing,
as a corporation or general partnership in good standing under the
laws of its jurisdiction of organization with requisite corporate or
partnership power and authority to own or lease its properties and
conduct its business as described in the Final Memorandum, and is duly
qualified to do business as a foreign corporation or partnership and
is in good standing under the laws of each jurisdiction in which the
character of the business conducted by it or the location of the
properties owned or leased by it make such qualification necessary,
except to the extent that the failure to be so qualified or be in good
standing would not have, individually or in the aggregate, a Material
Adverse Effect;
(ii) all of the issued and outstanding shares of Capital Stock
of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable; and all of the issued and
outstanding shares of Capital Stock of each Guarantor have been duly
and validly authorized and issued, are fully paid and non-assessable,
and are owned directly by the Company or a Wholly Owned Restricted
Subsidiary;
(iii) each of the Company and the Guarantors has the requisite
corporate or partnership power and authority to execute and deliver,
and to perform its respective obligations under, this Agreement, the
Indenture, the Notes, the Guarantees and the Registration Rights
Agreement (subject, in the case of the Registration Rights Agreement,
to approvals required under the Securities Act), to consummate the
transactions contemplated hereby and thereby, and to issue, sell and
deliver the Securities to be sold by it to the Initial Purchasers as
provided herein and therein;
(iv) each of this Agreement, the Indenture and the Registration
Rights Agreement, and the consummation of each of the transactions
contemplated hereby and thereby, has been duly and validly authorized
by all necessary corporate or partnership action (including, without
limitation, all required stockholder, shareholder and general partner
approvals, if any) of the Company and each Guarantor, to the extent
each is a party thereto; each of this Agreement, the Indenture and the
Registration Rights Agreement has been executed and delivered by each
of the Company and the Guarantors party thereto; and each of the
Indenture and the Registration Rights Agreement constitutes a legal,
valid and binding agreement of each of the Company and the Guarantors
party thereto, enforceable against each of the Company and the
Guarantors party thereto in accordance with their respective terms,
except as such enforceability (x) may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting creditors'
rights generally, (y) is subject to general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in
-15-
equity or at law) and (z) with respect to rights to indemnity or
contribution, may be limited by applicable law or by the policies
underlying such laws;
(v) the Notes have been duly and validly authorized by the
Company by all necessary corporate action (including, without
limitation, all required stockholder approvals, if any) and, when
executed and authenticated in accordance with the provisions of the
Indenture, and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, will be legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as such enforceability (x) may be
limited by bankruptcy, insolvency, reorganization or other similar
laws affecting creditors' rights generally, (y) is subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (z) with respect
to rights to indemnity or contribution, may be limited by applicable
law or by the policies underlying such laws, and will be entitled to
the benefits of the Indenture; and the Securities, the Indenture and
the Registration Rights Agreement conform in all material respects to
the descriptions thereof contained in the Final Memorandum on or prior
to the Closing Date;
(vi) the Guarantees have been duly and validly authorized by all
necessary corporate or partnership action (including, without
limitation, all required stockholder, shareholder and general partner
approvals, if any) and, when executed and authenticated in accordance
with the terms of the Indenture and delivered to the Initial
Purchasers in accordance with the terms of this Agreement, will be
legal, valid and binding obligations of the Guarantors enforceable
against the Guarantors in accordance with their terms, except as such
enforceability (x) may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights
generally, (y) is subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity
or at law), and will be entitled to the benefits of the Indenture and
(z) with respect to rights to indemnity or contribution, may be
limited by applicable law or by the policies underlying such laws;
(vii) the statements set forth in the Final Memorandum under the
caption "Certain Federal Income Tax Considerations", insofar as such
statements constitute a summary of legal matters, are accurate in all
material respects; provided that no inference shall be drawn that such
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counsel is giving any opinion with respect to tax matters as they
apply to any particular holder of Securities.
(viii) to the knowledge of such counsel, there is no action,
suit or proceeding before any court or governmental agency, authority
or body or any arbitrator which is pending or threatened against the
Company or any Guarantor that would reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, except as
described in the Final Memorandum;
(ix) no consent, approval, authorization or order of, or filing
or registration or qualification with, any court or governmental
agency or body or financial institution, or any other party under any
loan agreement, indenture, mortgage, deed of trust, lease, network
affiliation agreement, programming contract or any other agreement or
instrument described in the Final Memorandum to which the Company or
any of the
-16-
Guarantors is a party or by which any of them is bound or to which any
of their respective properties is subject, is required on the part of
the Company or any Guarantor for the authorization, issuance, sale and
delivery of the Securities, or the execution, delivery and performance
by the Company and the Guarantors of their respective obligations
under this Agreement, the Indenture and the Registration Rights
Agreement or the consummation of the transactions contemplated hereby
or thereby, except (1) as have been obtained, (2) as may be required
under the "Blue Sky" laws of the various states in connection with the
offer and sale of the Securities and (3) as may be required by the
Securities Act, the "Blue Sky" laws of the various states, the Trust
Indenture Act and the bylaws and rules of the NASD, in conjunction
with an exchange offer for, or registered resale of, the Securities
pursuant to the Registration Rights Agreement and the qualification of
the Indenture and the Trustee;
(x) neither the Company nor any Guarantor is, or with the giving
of notice or lapse of time or both would be, in violation of or in
default under, nor does the execution and delivery of this Agreement,
the Indenture and the Registration Rights Agreement, nor will the
consummation of the transactions contemplated hereby and thereby,
result in a violation of, or constitute a default under, the
Certificates or Articles of Incorporation, by-laws or other governing
documents of the Company or any of the Guarantors, or any loan
agreement, indenture, mortgage, deed of trust, lease, network
affiliation agreement, programming contract or any other agreement or
instrument described in the Final Memorandum to which the Company or
any of the Guarantors is a party or by which any of them is bound, or
to which any of their respective properties is subject, except for
such violations of or such defaults under any such loan agreement,
indenture, mortgage, deed of trust, lease, network affiliation
agreement, programming contract or other agreement or instrument, as
would not, individually or in the aggregate, have a Material Adverse
Effect; nor will the performance by the Company and the Guarantors of
their respective obligations hereunder and thereunder violate any law,
rule or administrative regulation, to such counsel's knowledge, any
license or any decree of any court, governmental agency or body having
jurisdiction over the Company or any of the Guarantors, or any of
their respective properties, or, to such counsel's knowledge, result
in the creation or imposition of any lien, charge, claim or
encumbrance upon any property or asset of the Company or any of the
Guarantors, except such violation, lien, charge, claim or encumbrance
as would not, individually or in the aggregate, have a Material
Adverse Effect;
(xi) no registration of the Securities under the Securities Act
is required for the sale of the Securities to the Initial Purchasers
as contemplated by this Agreement or for the initial resale thereof in
the manner contemplated in this Agreement, assuming that (a) the
offering of the Securities has been conducted solely in the manner
contemplated by the Final Memorandum, this Agreement, the Indenture
and the Registration Rights Agreement, (b) the Initial Purchasers' and
the Company's representations and warranties in this Agreement are
true, (c) the representations of accredited investors in the form set
forth in Exhibit A to the Final Memorandum are true, (d) each
purchaser is a qualified institutional buyer or an accredited
investor, and (e) the Initial Purchasers deliver (or cause the
delivery) promptly to each such purchaser purchasing the Securities
from the Initial Purchasers, a copy of the Final Memorandum;
-17-
(xii) pursuant to exemptions under the Investment Company Act and
based upon no-action letters issued by the staff of the Commission,
neither the Company nor any of the Guarantors is, and after giving
effect to the offering and sale of the Securities and the application
of the proceeds therefrom as described in the Final Memorandum under
the caption "Use of Proceeds", will be, an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act;
(xiii) when the Securities are issued and delivered pursuant to
this Agreement, the Securities will not be of the same class (within
the meaning of Rule 144A under the Securities Act) as securities of
the Company and the Guarantors, if any, which are listed on a national
securities exchange registered under Section 6 of the Exchange Act and
the rules and regulations of the Commission promulgated thereunder or
quoted in a United States automated interdealer quotation system;
accordingly, the offer and sale of the Securities in the manner
contemplated by this Agreement and the Final Memorandum will be in
compliance with paragraph (d)(3) of Rule 144A under the Securities
Act;
(xiv) the Final Memorandum appears on its face to comply as to
form in all material respects with the applicable requirements of
paragraph (d)(4) of Rule 144A under the Securities Act;
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the laws of the
State of New York or the State of California, the corporation laws of the State
of Delaware, or the laws of the United States of America, to the extent they
deem proper and specified in such opinion, upon the opinion of other counsel of
good standing whom they believe to be reliable and who are satisfactory to
counsel for the Initial Purchasers and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
public officials.
In addition such counsel shall state that such counsel assisted in the
preparation of the Final Memorandum and no facts have come to the attention of
such counsel that lead such counsel to believe that the Final Memorandum
(excluding financial statements and other financial and statistical data
contained therein, as to which such counsel need not express an opinion) as of
its date and as of the Closing Date, contained or contains any untrue statement
of a material fact or omitted or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(d) The Company shall have furnished to the Initial Purchasers the
opinion of Xxxxxxxx, Xxxxx & Xxxxxxxx, P.L.C., special communications
counsel to the Company, dated the Closing Date, to the effect that:
(i) for each Station stated in the Final Memorandum as being
owned by the Company, the Company or one of the Guarantors and, for
each Station stated in the Final Memorandum as being operated but not
owned by the Company or a Guarantor, the licensee of such Station,
holds the licenses for the operation of such Station and all such
licenses are in full force and effect;
-18-
(ii) based on a review of the pertinent public files of the FCC,
appropriate files of such counsel and an inquiry of the lawyers
thereof who have had substantial responsibility for the Company's
legal matters handled by such counsel, such counsel confirms that,
other than rulemaking proceedings or similar proceedings of general
applicability to entities such as the Company or to facilities such as
the Stations, there is no action, suit, or proceeding before the FCC
pending or to such counsel's knowledge, threatened against or
affecting the Company or any of the Guarantors that could reasonably
be expected to have, individually or in the aggregate, a Material
Adverse Effect;
(iii) no authorizations, consents, approvals, licenses, filings
or registrations with the FCC are required in connection with the
execution, delivery or performance by the Company or any Guarantor of
this Agreement, the Indenture, the Registration Rights Agreement, the
Notes or the Guarantees, or the consummation of the transactions
contemplated hereby or thereby; and
(iv) such counsel assisted in the preparation of the Final
Memorandum and no facts have come to the attention of such counsel
that lead them to believe that the statements contained under the
captions "Risk Factors--Regulatory Matters" and "Business--Federal
Regulation of Radio Broadcasting" in the Final Memorandum as of its
date and as of the Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state any material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(e) The Initial Purchasers shall have received on the Closing Date
the opinion or opinions of Milbank, Tweed, Xxxxxx & XxXxxx, dated the
Closing Date, on such matters as the Initial Purchasers may reasonably
request and such counsel shall have received such documents and information
as they may reasonably request to enable them to pass upon such matters.
(f) The Company, the Guarantors and the Trustee shall have executed
and delivered the Indenture in substantially the form of the draft dated
the date hereof with such changes as may be reasonably satisfactory to the
Initial Purchasers, and the Indenture shall be in full force and effect.
(g) The Company shall have furnished to the Initial Purchasers on the
date hereof and on the Closing Date, a letter of Ernst & Young LLP, as
independent auditors to the Company, addressed to the Initial Purchasers
and the Board of Directors of the Company and dated the date hereof or the
Closing Date as the case may be, in form and substance satisfactory to the
Initial Purchasers, containing statements and information of the type
customarily included in accountants' "comfort letters" to underwriters with
respect to the consolidated financial statements, summary and selected
consolidated financial information and certain other financial information
contained in the Final Memorandum.
(h) The Securities shall be eligible for trading on the Private
Offerings, Resales and Trading through Automated Linkages Market ("PORTAL")
system of the NASD.
-19-
(i) The Company, the Trustee and The Depository Trust Company shall
have executed and delivered the letter of representations with respect to
the Securities in substantially the form of the draft dated the date hereof
with such changes as may be reasonably satisfactory to the Initial
Purchasers.
(j) The Company and the Guarantors shall have executed and delivered
the Registration Rights Agreement in substantially the form of the draft
dated the date hereof with such changes as may be reasonably satisfactory
to the Initial Purchasers, and the Registration Rights Agreement shall be
in full force and effect.
(k) The Company and the Guarantors shall have furnished to the
Initial Purchasers an accurate certificate dated as of the Closing Date, in
form and substance satisfactory to the Initial Purchasers, signed by the
Secretary of the Company and each Guarantor, and attaching Articles or
Certificates of Incorporation, bylaws, resolutions, a specimen of the
Notes, evidence with respect to FCC licenses and such other documents and
records as the Initial Purchasers may request.
The Company and the Guarantors will furnish the Initial Purchasers
with such additional opinions, certificates, letters and documents as the
Initial Purchasers may reasonably request.
5. Covenants of the Company. In further consideration of the
------------------------
agreements of the Initial Purchasers herein obtained, each of the Company and
the Guarantors covenants and agrees with the Initial Purchasers as follows:
(a) To furnish the Initial Purchasers, without charge, during the
period mentioned in paragraph (c) below, as many copies of each Memorandum
as the Initial Purchasers may reasonably request;
(b) During the period mentioned in paragraph (c) below, before
amending or supplementing the Final Memorandum, to furnish the Initial
Purchasers a copy of each such proposed amendment or supplement, and to
make no such proposed amendment or supplement to which the Initial
Purchasers reasonably objects;
(c) If, during such period after the date hereof and prior to the
date on which all of the Securities have been sold by the Initial
Purchasers, any event shall occur as a result of which the Final Memorandum
as then amended or supplemented would, in the judgement of the Company or
counsel to the Initial Purchasers, include any untrue statement of a
material fact, or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if for any other reason it is necessary to amend
or supplement the Final Memorandum to comply with applicable law, promptly
to prepare and furnish, at its own expense, to the Initial Purchasers,
either an amendment or supplement to the Final Memorandum that corrects
such statement or omission or effects such compliance;
(d) During the period mentioned in paragraph (c) above, to advise the
Initial Purchasers promptly of the happening of any event as a result of
which the Final Memorandum would, in the opinion of the Company, include
any untrue statement of a material fact, or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
-20-
(e) To endeavor to qualify the Securities for offer and sale under the
securities laws of such jurisdictions in the United States as the Initial
Purchasers may reasonably request, to file such statements and reports as
may be required by the laws of each such jurisdiction in which the
Securities have been so qualified, and to supply the Initial Purchasers
with such information as is necessary for the determination of the legality
of the Securities for investment under the laws of such jurisdictions as
the Initial Purchasers may request; except that in no event shall the
Company or any Guarantor be obligated in connection therewith to qualify as
a foreign corporation, or to execute a general consent to service of
process;
(f) Not, for a period of 180 days following the date hereof, without
the prior written consent of Xxxxxx Xxxx LLC, to offer, sell, contract to
sell or otherwise dispose of, directly or indirectly, any Securities;
(g) So long as any Securities are outstanding, to provide the Trustee
and holders of any of the Securities copies of its annual reports and of
the information, documents and reports that the Company or any Guarantor is
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act within 15 days after it files them with the Commission and if,
during any period in which Securities are outstanding, the Company is not
obligated to file annual reports, documents or other reports with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act, to furnish
to the Trustee the same such annual reports, documents or other reports as
if the Company were so subject. In addition, at all times prior to the
declaration of effectiveness of the registration statement required
pursuant to the Registration Rights Agreement, upon the request of any
holder of Securities or any prospective purchaser of the Securities
designated by such holder, the Company shall supply to such holder or such
prospective purchaser the information required under Rule 144A under the
Securities Act, unless the Company is then subject to Section 13 or 15(d)
of the Exchange Act and reports filed thereunder satisfy the information
requirements of Rule 144A(d)(4) as then in effect;
(h) If requested by the Initial Purchasers, to use all reasonable
efforts to maintain the securities as PORTAL securities in accordance with
the rules and regulations adopted by the NASD relating to trading in the
PORTAL market through such time as a registration statement covering the
Notes shall have become effective or all of the Notes shall have become
eligible for resale without the requirement that such resales comply with
the volume or manner of sale restrictions of Rule 144 of the Act;
(i) To hold the Initial Purchasers harmless against any documentary,
stamp or similar transfer or issue tax, including any interest and
penalties, on the issue, sale and delivery of the Securities in accordance
with the terms of this Agreement and on the execution and delivery of this
Agreement, the Indenture and the Registration Rights Agreement which are or
may be required to be paid under the laws of the United States or any
political subdivision or taxing authority thereof or therein;
(j) Not sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Securities Act)
that is or will be integrated with the sale of the Securities in a manner
that would require the registration of the Securities under the Securities
Act;
-21-
(k) Not to solicit any offer to buy, offer or sell the Securities by
means of any form of general solicitation or general advertising (as those
terms are used in Regulation D under the Securities Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the
Securities Act;
(l) To comply with all of the terms and provisions of the
Registration Rights Agreement;
(m) For a period of five years following the Closing Date, to furnish
to the Initial Purchasers copies of any annual reports, quarterly reports
and current reports filed with the Commission on Forms 10-K, 10-Q and 8-K,
or such other similar forms as may be designated by the Commission, and
such other documents, reports and information as shall be furnished by the
Company to the Trustee or to the holders of the Securities pursuant to the
Indenture;
(n) During the period from the Closing Date to the date that is two
years after the Closing Date, not, and not permit any of its "affiliates"
(as defined in Rule 144 of the Act) to, resell any Securities that have
been acquired by any of them except for Securities purchased by the Company
of any such affiliate and resold in a transaction registered under the Act
or exempt from the registration requirements of the Act;
(o) To use the proceeds from the sale of the Securities in the manner
set forth in the Final Memorandum; and
(l) On the Closing Date, the Company shall repay all amounts owing
under the Existing Credit Agreement by wire transfer from the Initial
Purchasers of the proceeds of the offering of the Securities to the lenders
under the Existing Credit Agreement and shall terminate the Existing Credit
Agreement and enter into the New Credit Agreement. On or before the
Closing Date, the Company shall terminate and pay all amounts due under any
outstanding interest rate swap or other interest rate hedging agreements.
The Company promptly shall provide the Initial Purchasers evidence of each
such action.
6. Expenses. Whether or not this Agreement becomes effective or is
--------
terminated or the sale of the Securities to the Initial Purchasers is
consummated, the Company agrees to pay (i) the costs incident to the
authorization, issuance, sale and delivery of the Securities and any taxes
payable in that connection; (ii) the costs (including, without limitation, fees
and expenses of the Company's accountants and counsel) incident to the
preparation, printing and delivery and distribution to the Initial Purchasers of
each Memorandum and any amendments and exhibits thereto, as provided in this
Agreement; (iii) the costs of delivery and shipping of the Indenture, the
Registration Rights Agreement, this Agreement and related documents, including,
but not limited to any "Blue Sky" memoranda; (iv) the fees payable to rating
agencies in connection with the rating of the Securities; (v) the fees and
expenses (including reasonable fees and disbursement of counsel to the Initial
Purchasers in connection therewith) of qualifying the Securities for offering
and sale under the securities laws of the several jurisdictions; (vi) any
applicable filing fees associated with filings made with the NASD in connection
with the PORTAL application for the Securities; (vii) the costs and charges of
the Trustee and any paying agent or registrar; and (viii) all other costs and
expenses incident to the performance of its obligations hereunder for which
provision is not otherwise made in this Section 6.
7. Indemnification and Contribution. (a) Each of the Company and
--------------------------------
the Guarantors agrees to indemnify and hold harmless the Initial Purchasers, its
officers, authorized representatives
-22-
and directors and each person, if any, who controls the Initial Purchasers
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, or is under common control with, or is controlled by, the
Initial Purchasers, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any reasonable legal or other
expenses actually incurred by the Initial Purchasers or any such controlling or
affiliated person in connection with defending or investigating any such action
or claim) caused by, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Memorandum if the
Company shall have furnished any amendments or supplements thereto, or in any
"blue sky" application or other document executed by the Company or any of the
Guarantors in connection with in any such application procedure or based upon
written information furnished by the Company or any of the Guarantors
specifically to be filed in any state or other jurisdiction in order to qualify
any or all the Securities under the securities laws thereof or specifically to
be filed with the Commission or any securities association or securities
exchange (each, an "APPLICATION"), or caused by, arising out of or based upon
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made not misleading, except insofar as such
losses, claims, damages, liabilities or expenses are caused by any such untrue
statement or omission or alleged untrue statement or omission relating to the
Initial Purchasers made in any Memorandum, or any Application, made in reliance
upon and in conformity with information relating to the Initial Purchasers
furnished to the Company in writing by the Initial Purchasers expressly for use
therein; provided, however, that the Company and the Guarantors shall not be
-------- -------
required to indemnify any such person if such untrue statement or omission or
alleged untrue statement or omission was contained or made in the Preliminary
Memorandum and corrected in the Final Memorandum and the Final Offering
Memorandum does not contain any other untrue statement or omission or alleged
untrue statement or omission of a material fact that was the subject matter of
the related proceeding and any such loss, claim, damage, liability or expense
suffered or incurred by such person resulted from any action, claim or suit by
any person who purchased Securities that are the subject thereof from the
Initial Purchasers and it is established in the related proceeding that the
Initial Purchasers failed to deliver or provide a copy of the Final Memorandum
to such person with or prior to the written confirmation of the sale of such
Securities sold to such person if required by applicable law, unless such
failure to deliver or provide a copy of the Final Memorandum was a result of
noncompliance by the Company and the Guarantors with Section 5(a) hereof.
(b) The Initial Purchasers agree to indemnify and hold harmless the
Company, the Guarantors, their respective officers and directors and each
person, if any, who controls the Company and the Guarantors within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company and the Guarantors
to the Initial Purchasers, but only with reference to information relating to
the Initial Purchasers furnished to the Company in writing by or on behalf of
the Initial Purchasers expressly for use in either Memorandum.
(c) If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be instituted or asserted
against any person in respect of which indemnity may be sought pursuant to
either of paragraph (a) or (b) above, such person (hereinafter called the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (hereinafter called the "INDEMNIFYING PARTY") in
writing; provided, however, that the failure to so notify the indemnifying party
-------- -------
shall not relieve it of any obligation or liability that it may have hereunder
or otherwise (unless and only to the extent that such failure directly results
in the loss or compromise of any material rights or defenses by the indemnifying
party and the indemnifying party was not otherwise aware of such action or
claim). The indemnifying party, upon request of the
-23-
indemnified party, shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others that the indemnifying party may designate in
such proceeding and shall pay the reasonable fees and disbursements of such
counsel related to such proceeding. In any such action or proceeding, any
indemnified party shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have mutually
agreed in writing to the contrary, (ii) the indemnifying party shall have failed
within a reasonable period of time to retain counsel reasonably satisfactory to
the indemnified party, or (iii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party or any affiliate of either and representation of both parties
by the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that, unless there exists a conflict
among indemnified parties, the indemnifying party shall not, in connection with
any one such proceeding or separate but substantially similar related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any appropriate local counsel) for
all indemnified parties, and that all such fees and expenses shall be reimbursed
promptly after the receipt of the invoice therefor as they are incurred. Any
such separate firm shall be designated in writing by Xxxxxx Xxxx LLC in the case
of parties indemnified pursuant to paragraph (a) above and by the Company in the
case of parties indemnified pursuant to paragraph (b) above. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its prior written consent, but if settled with such consent or if there be a
final judgment for the plaintiff for which the indemnified party is entitled to
indemnification pursuant to this Agreement, the indemnifying party agrees to
indemnify and hold harmless each indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party
shall, without the prior written consent of the indemnified party (which consent
shall not be unreasonably withheld), effect any settlement or compromise of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement or compromise (A) includes an
unconditional release of such indemnified party, in form and substance
reasonably satisfactory to such indemnified party from all liability on claims
that are the subject matter of such proceeding, and (B) does not include any
statement as to an admission of fault, culpability or failure to act by or on
behalf of any indemnified party.
(d) To the extent the indemnification provided in paragraph (a) or
(b) of this Section 7 is for any reason unavailable to (other than by reason of
exceptions provided therein), or insufficient to hold harmless, an indemnified
party in respect of any losses, claims, damages, liabilities or expenses (or
actions in respect thereof) referred to therein, then each indemnifying party
under such paragraphs, in lieu of indemnifying such indemnified party thereunder
and in order to provide for just and equitable contribution, shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities in such proportion as is appropriate to reflect
(i) the relative benefits received by the Company and the Guarantors on the one
hand and the Initial Purchasers on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, not only such relative benefits but also the
relative fault of the Company and the Guarantors on the one hand and the Initial
Purchasers on the other hand in connection with the statements or omissions or
alleged statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other hand in
connection with the offering of the Securities shall be deemed to be in the same
proportion as the total proceeds from the offering of the Securities (net of
discounts and commissions but before deducting expenses) received by the Company
and the
-24-
Guarantors bears to the total discounts and commissions received by the Initial
Purchasers in respect thereof, in each case as set forth in the Final
Memorandum. The relative fault of the Company and the Guarantors on the one
hand and the Initial Purchasers on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Guarantors on the one
hand or by the Initial Purchasers on the other hand, the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission, and any other equitable considerations appropriate
in the circumstances.
(e) The Company, the Guarantors and the Initial Purchasers agree that
it would not be just and equitable if contribution pursuant to Section 7(d)
hereof were determined by pro rata allocation or by any other method of
--------
allocation that does not take account of the equitable considerations referred
to in paragraph (d) above. The amount paid or payable by an indemnified party
as a result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to in paragraph (d) above shall be deemed to include, subject
to the limitations set forth above, any reasonable legal or other expenses
actually incurred by such indemnified party in connection with defending or
investigating any such action or claim. Notwithstanding the provisions of
Section 7(d) hereof, no Initial Purchaser shall be required to contribute any
amount in excess of the amount by which the total price at which the Securities
purchased and resold by it exceeds the amount of any damages that the Initial
Purchaser has otherwise been required to pay or has paid by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
The indemnity and contribution provisions contained in this Section 7
and the representations and warranties of the Company and the Guarantors
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of the Initial Purchasers or any person controlling the Initial
Purchasers or under common control with or controlled by the Initial Purchasers
or by or on behalf of the Company, the Guarantors, their respective officers,
authorized representatives or directors or any person controlling the Company
and the Guarantors and (iii) acceptance of and payment for any of the
Securities.
The indemnity and contribution agreements contained in this Section 7
will be in addition to any liability that the indemnifying party or parties may
otherwise have to the indemnified party or parties referred to above.
8. Termination and Survival. This Agreement may be terminated for
------------------------
any reason at any time prior to the delivery and payment of the Securities on
the Closing Date, as the case may be, by the Initial Purchasers upon written
notice of such termination to the Company, if prior to such time (i) there has
been, since the respective dates as of which information is given in each
Memorandum, (A) any material adverse change in the condition, (financial or
otherwise), results of operations, business, prospects, net worth or assets of
the Company and the Guarantors, taken as a whole, whether or not arising in the
ordinary course of business or (B) except as contemplated by this Agreement, any
material transaction entered into by the Company or the Guarantors other than in
the ordinary course of business, or (ii) there has occurred any outbreak or
escalation of hostilities or other calamity or crisis or material change in
existing national or international financial, political, economic or securities
market conditions, the effect of which is such as to make it, in the judgment of
the Initial Purchasers, impracticable or inadvisable to offer and deliver the
Securities in the manner contemplated
-25-
in the Final Memorandum or enforce contracts for the sale of Securities, or
(iii) trading generally on the New York Stock Exchange or quotations on the
Nasdaq National Market, either has been suspended, or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices for securities have
been required by either of said organizations or by order of the Commission or
any other governmental authority or, if a banking moratorium has been declared,
by either Federal or New York authorities, or (iv) any downgrading shall have
occurred in the rating accorded the Securities by any "nationally recognized
statistical rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act.
In the event of any such termination, the provisions of Section 6
hereof, the indemnity agreement and contribution provisions set forth in Section
7 hereof, and the provisions of Sections 9 and 14 hereof shall remain in effect.
9. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company or the Guarantors submitted
pursuant hereto, including indemnity and contribution agreements, shall remain
operative and in full force and effect, regardless of any termination of this
Agreement, or any investigation made by or on behalf of the Initial Purchasers
or any person controlling the Initial Purchasers or by or on behalf of the
Company, the Guarantors, or their respective officers or directors, and shall
survive acceptance of and payment for the Notes hereunder.
10. Notices. All notices and other communications hereunder shall be
-------
in writing and shall be deemed to have been duly given if mailed or transmitted
by any standard form of telecommunication. Notices to the Initial Purchasers
shall be directed to 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Syndicate Department, with a copy to Milbank, Tweed, Xxxxxx & XxXxxx, 000 Xxxxx
Xxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxx
X. Xxxxxxxx, Esq.; notices to the Company shall be directed to it at 0000 Xxxxx
Xxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Chief Operating
Officer, with a copy to Xxxxxx, Xxxx & Xxxxxxxx LLP, Jamboree Center, 0 Xxxx
Xxxxx, Xxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxx X. Xxxxxx, Esq..
11. Headings. The headings of the sections of this document have
--------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
12. Parties. This Agreement shall inure to the benefit of and be
-------
binding upon the Company, the Guarantors, the Initial Purchasers, any
controlling persons referred to herein and their respective successors and
assigns. Nothing expressed or mentioned in this Agreement is intended or shall
be construed to give any other person, firm or corporation any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provisions herein contained. No purchaser of Securities from the Initial
Purchasers shall be deemed to be a successor by reason merely of such purchase.
13. Counterparts. This Agreement may be signed in any number of
------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
-26-
14. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE LAW
OF CONFLICTS OF LAWS THEREOF.
-27-
Please confirm your agreement to the foregoing by signing in the space
provided below for that purpose and returning to us a copy hereof, whereupon
this Agreement shall constitute a binding agreement between the Company and the
Guarantors, on the one hand, and the Initial Purchasers on the other hand.
Very truly yours,
SALEM COMMUNICATIONS CORPORATION
a California corporation
/s/ Xxxxxx X. Xxxxxxxx
By:_______________________________
Xxxxxx X. Xxxxxxxx, III
President and Chief Executive Officer
ATEP RADIO, INC.,
BISON MEDIA, INC.,
XXXXX BROADCASTING, INC.,
COMMON GROUND BROADCASTING, INC.,
GOLDEN GATE BROADCASTING
COMPANY, INC.,
INLAND RADIO, INC.,
INSPIRATION MEDIA OF TEXAS, INC.,
INSPIRATION MEDIA, INC.,
NEW ENGLAND CONTINENTAL MEDIA, INC.,
NEW INSPIRATION BROADCASTING
COMPANY, INC.,
OASIS RADIO, INC.,
PENNSYLVANIA MEDIA ASSOCIATES, INC.,
RADIO 1210, INC.,
SALEM COMMUNICATIONS CORPORATION, a
Delaware corporation
SALEM MEDIA CORPORATION,
SALEM MEDIA OF CALIFORNIA, INC.,
SALEM MEDIA OF COLORADO, INC.,
SALEM MEDIA OF LOUISIANA, INC. and
SALEM MEDIA OF OHIO, INC.,
SALEM MEDIA OF OREGON, INC.,
SALEM MEDIA OF PENNSYLVANIA, INC.,
SALEM MEDIA OF TEXAS, INC.,
SALEM MUSIC NETWORK, INC.,
SALEM RADIO NETWORK INCORPORATED,
SALEM RADIO REPRESENTATIVES, INC.,
SOUTH TEXAS BROADCASTING, INC.,
SRN NEWS NETWORK, INC.,
VISTA BROADCASTING, INC.,
/s/ Xxxxxx X. Xxxxxxxx
By:______________________________
Xxxxxx X. Xxxxxxxx, III
President and Chief Executive Officer
-28-
BELTWAY MEDIA PARTNERS
By: GOLDEN GATE BROADCASTING COMPANY, INC., its
general partner
/s/ Xxxxxx X. Xxxxxxxx
By:____________________________
Xxxxxx X. Xxxxxxxx, III
President and Chief Executive Officer
By: SALEM COMMUNICATIONS CORPORATION, a
California corporation, its general partner
/s/ Xxxxxx X. Xxxxxxxx
By:_______________________
Xxxxxx X. Xxxxxxxx, III
President and Chief Executive Officer
By: NEW INSPIRATION BROADCASTING COMPANY, INC.,
its general partner
/s/ Xxxxxx X. Xxxxxxxx
By:_______________________
Xxxxxx X. Xxxxxxxx, III
President and Chief Executive Officer
Accepted:
September 17, 1997
XXXXXX XXXX LLC
XXXXX XXXXXX INC.
BANCBOSTON SECURITIES INC.
BNY CAPITAL MARKETS, INC.
By: Xxxxxx Xxxx LLC
/s/ Xxxxxx Xxxxxx
By:___________________________
Xxxxxx Xxxxxx
Vice President
-29-
Schedule I
Initial Purchasers Amount of Notes to be Purchased
------------------ -------------------------------
Xxxxxx Xxxx LLC $ 75,000,000
Xxxxx Xxxxxx Inc. 45,000,000
BancBoston Securities Inc. 15,000,000
BNY Capital Markets, Inc. 15,000,000
------------
Total $150,000,000
-30-
Schedule II
Subsidiaries of the Company
---------------------------
Jurisdiction
Name: of formation: Qualified in:
----- ------------- -------------
ATEP Radio, Inc. California
Beltway Media Partners Virginia
Bison Media, Inc. Colorado Xxxxxxxxxx
Xxxxx Broadcasting, Inc. Ohio Maryland
Common Ground Broadcasting, Inc. Oregon Arizona, Minnesota and Ohio
Golden Gate Broadcasting Company, Inc. California
Inland Radio, Inc. California
Inspiration Media of Texas, Inc. Texas
Inspiration Media, Inc. Washington
New England Continental Media, Inc. Massachusetts
New Inspiration Broadcasting Company, Inc. California
Oasis Radio, Inc. California
Pennsylvania Media Associates, Inc. Pennsylvania
Radio 1210, Inc. California
Salem Communications Corporation Delaware
Salem Media Corporation New York Illinois
Salem Media of California, Inc. California
Salem Media of Colorado, Inc. Colorado
Salem Media of Louisiana, Inc. Louisiana
Salem Media of Ohio, Inc. Ohio
Salem Media of Oregon, Inc. Oregon
Salem Media of Pennsylvania, Inc. Pennsylvania
Salem Media of Texas, Inc. Texas
Salem Music Network, Inc. Texas Colorado and Tennessee
Salem Radio Network Incorporated Delaware Texas and Xxxxxxxx
Xxxxx Radio Representatives, Inc. Texas California, Illinois, New York,
Tennessee and Virginia
South Texas Broadcasting, Inc. Texas
SRN News Network, Inc. Texas District of Columbia and Virginia
Vista Broadcasting, Inc. California
-31-
